Sun | Mar 24, 2019

Jamaica must move boulders if island hopes for growth

Published:Thursday | March 27, 2014 | 12:00 AM
King

The Government is being warned that it will be futile to pursue a growth agenda until the main impediments to achieving sustainable economic growth are addressed.

Addressing a Gleaner Editors' Forum at the newspaper's downtown Kingston offices on Wednesday, Dr Damien King, head of the economics department at the University of the West Indies (UWI), Mona, said said the discussions surrounding the development and pursuit of a growth agenda by the Government were superfluous at this point.

"If we have a situation where the sort of big obvious obstacles are out of the way, then we can have a debate of how much more clever we need to be to stimulate growth," argued King. "But if you have a big boulder in the road, it is clear that the first thing you need to do is to get the boulder out of the way."

He identified Jamaica's large fiscal deficit, worrying crime and security situation, poor infrastructure and inefficient bureaucracy as the key impediments to achieving sustainable economic growth.

"In Jamaica's particular situation, the debate about whether the economic environment is sufficient is less pressing only because we have these big boulders in the road," King argued.

"There is no doubt that those are important impediments to growth...," said Professor Densil Williams, executive director of the Mona School of Business at the UWI, in agreement with his colleague.

However, Williams said he felt the Government should also place priority focus on stimulating short-term growth to build confidence in the local economy.

"My thinking is that we really need something to stimulate growth to bring back some confidence," he told the forum.

"The problem is that if you continue to underperform and nobody sees any sign or light at the end of the tunnel, we are just going to get depressed and hopeless," he said, emphasising that "what you need to do is to find those projects and solutions that can at least allow us to turn the corner".

Williams, who is a professor of international business at the UWI, reasoned that it was necessary for the Government to "classify where we need to go in the short, medium and long-term, because some of the great things that can happen in the long term still are not going to get done if you don't have the confidence engendered in the short term".

Dr Christopher Tufton, co-executive director of the Caribbean Policy Research Institute (CaPRI), contended that there was not enough confidence currently existing to spur the level of investment that would generate tangible economic growth.

confidence

"In terms of confidence, the first thing an investor would look at is the extent to which the policy prescriptions being pursued can be determined and predicted over time," Tufton argued. "I believe that the extent to which investors can actually cut through the bureaucracy of business and doing business to me is an absolute priority."

Continuing, Tufton, who is a former government minister with responsibility for agriculture at one time and industry, investment and commerce at another, during the previous Jamaica Labour Party administration, said: "I get the sense that even though we are achieving the targets of the International Monetary Fund (IMF) it is a mechanical exercise and not enough is being done to ensure that it is a means to an end. The end in itself is to facilitate, encourage and motivate entrepreneurs to start investing again in the economy."

For him, the areas of focus would be getting projects that have been deemed viable off the ground, undertaking the training and retraining of the workforce and integrating micro, small and medium-sized businesses into the formal economy.

john.myers@gleanerjm.com